Quote:
Originally Posted by davezaristo
Can anyone explain to me the line item for "upfront taxes" and how is that calculated?
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Some states like CA just charge tax on your monthly payment or the depreciated amount of the car while in the lease term (it all means the same thing). This rate can be the same as the sales tax or a specialized rate that is different for sales tax.
PA for example has a 6% sales tax but charges 9% tax on every lease payment (higher in Philadelphia or Allegheny County).
Other states charge sales tax on the whole sale price of the vehicle. I think Texas does this. For this reason leasing is not desired. BMW has combated this by creating owners choice which gives a temporarily low initial payment with a lump sum at the end. I circumvents the lease tax and still allows the buyer to walk away before the lump sum is due.
Taxes vary too much from state to state for me to be accurate or knowledgeable about every state.